Last updated on December 2, 2021
The Voluntary Sector (also known as the third sector, nonprofit sector, and community sector) is usually comprised of organizations whose purpose is to benefit and enrich society, often without profit as a motive and with little or no government intervention.
Unlike the private sector where the generation and return of profit to its owners is emphasized, money raised or earned by an organization in the voluntary sector is usually invested back into the community or the organization itself.
One way to think of the voluntary sector is that its purpose is to create social wealth rather than material wealth.
Although the voluntary sector is separate from the public sector, many organizations are often tightly integrated with governments on all levels to support it in the delivery of programs and services.
Examples of the Voluntary Sector
There are many different types of organizations in the voluntary sector.
Some of these organizations have a mix of paid and volunteer staff, like most charities. Other organizations are much more loosely defined, like community groups, and can be composed entirely of volunteers.
Examples of organizations in the voluntary sector include:
- Charities: World Vision, American Red Cross, YWCA
- Foundations: David Suzuki Foundation, Bill and Melinda Gates Foundation
- Social Welfare Organizations: Human Rights Watch, Environmental Protection Agency (EPA)
- Advocacy Groups: Privacy International, World Wildlife Fund
- Faith-Based Organizations: Churches, Mosques, Temples
- Community Groups: Neighbourhood Watch, Knitting
- Recreational Sports: Ultimate Frisbee, Running Clubs
The National Center of Charitable Statistics (used by the IRS to classify nonprofits) divides nonprofits into 26 major groups under 10 broad categories.
Size of the Voluntary Sector
There are different estimates for the size, income, and activities of organizations in the voluntary sector.
In the US, the voluntary sector contributed an estimated $905.9b to the US economy in 2013, or 5.4% of the country’s gross domestic product (GDP).
In Canada, the voluntary sector accounts for 6.8% of the nation’s gross domestic product (GDP) and employs 12% of Canada’s economically active population (reported in 2005).
In the UK, it is estimated that the voluntary sector contributes £11.7 billion to UK gross value added (GVA, similar to a GDP), equivalent to 0.8% of the whole of the UK GVA (reported in 2012).
In 2014, the voluntary sector accounted for approximately 13% of the total EU workforce or 23 million full-time equivalents.